Airlines are changing their perks, testing fliers' loyalties

Harriet Baskas, Special to CNBC

Published 2:04 PM ET Mon, 18 Jan 2016
CNBC.com

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Early boarding privileges, waived checked bag fees, free flights and upgrades from the back of the plane to the front are just some of the benefits air travelers have come to expect from airline loyalty programs.

Yet program changes rolled out last year by some major U.S. carriers (notably Delta and United) made attaining the status needed to earn those perks much harder to achieve.

Experts say that in 2016, the estimated 65 million U.S. travelers who are loyalty program participants should expect more of the same.

"The programs are becoming more complicated," said Gary Leff, a travel expert who writes about points and miles on the View From the Wing blog. Leff said fliers are being rewarded more on how much they spend, not on how many miles they've flown, "and they're getting less rewarding." Many cabin award tickets, especially the premium variety, now cost more on Delta, United and — starting in March — on American Airlines, as well.

Still, the news isn't all bad. Some airlines, such as Alaska and Hawaiian, continue to award points based on miles flown. Others are adding new benefits for elite members, and adding more ways for members to spend banked miles they can't use in the air.

As airlines move to make changes to their frequent flyer programs, data from research firm Phocuswright suggests the impact on travelers is likely to be muted. While nearly a third of U.S. flyers are "mid-tier" loyalty members, only 4 percent say they have achieved elite status, said Doug Quinby, vice president of research for Phocuswright. He said that nearly half haven't even accrued enough miles to earn any benefits.

Alaska ups the perks

Sometime later this year, Alaska Airlines plans to become one of the few airlines boosting its perks. The company will introduce a Premium Class section, which will offer fliers more legroom and some additional perks. "Our elite Mileage Plan members will receive complimentary upgrades to this new seating section," airline spokeswoman Halley Knigge told CNBC.

Miles to go before you fly?

Late last year, American Airlines took what it called "the first step" in modifying its loyalty program. By the second half of this year, the company will begin awarding miles based on the price of tickets, and whether a member holds "elite" status.

"The biggest changes that will affect the most members will probably be award chart changes in March, and changing to a revenue-based program by the end of the year," American Airlines spokeswoman Laura Nedbal told CNBC.

That means that anyone with banked miles in American's AAdvantage program should look to spend them by March 21, said Brian Kelly, a travel expert with The PointsGuy.com.

"That's when they're changing the rates and, after that, in most markets you'll end up needing more miles for an award ticket," Kelly said. "In some cases the hike is 80 percent."

American's award tickets are good for one year from the date of issue, but Kelly notes you can change your day of travel later as long as you'll be flying the same route.

Have more drinks on Delta, if you qualify

Delta spokesman Anthony Black told CNBC the airline has added more international partners for SkyMiles redemptions, expanded its award pricing (lowering prices for some markets and raising them in others), and is rolling out a program that allows Delta Sky Club Lounge visitors to pay for drinks with SkyMiles. Some travel watchers say they have a few gripes with Delta's changes, however.

"Right now their system isn't very consumer-friendly," said Kelly, from The Points Guy. "They've made it so you can't just see how many miles you need for a trip and start saving. The goal posts seem to keep changing."

JetBlue gives you space — and drinks

This year, JetBlue will be giving elite TrueBlue Mosaic members complimentary alcoholic beverages onboard and reduced pricing to redeem points for Even More Space seats, according to airline spokeswoman Tamara Young.

United's sweeteners

United Airlines plans to sweeten what it calls "the premier qualification bonus for first and business-class fares," said airline spokesman Rahsaan Johnson. The airline plans to bring forward some member benefits it started rolling out late last year—including complimentary beer and wine for select Economy passengers.

MileagePlus program members may now also use award miles to pay for in-flight wireless service, and buy gifts, electronics and travel essentials at the Miles Shop in United's Terminal C and Newark Liberty International Airport.